Esther Cepeda: Students of all ages deserve a bailout on their loans

By Esther Cepeda Washington Post

Wednesday

Apr 24, 2019 at 4:06 PMApr 24, 2019 at 8:56 PM

Sen. Elizabeth Warren, D-Mass., proposes eliminating up to $50,000 in student debt for borrowers who make less than $100,000 per year, giving up to 42 million Americans what amounts to a second lease on life.

Philip Klein, the executive editor of the right-leaning Washington Examiner, opposes Warren’s idea. In a column with a headline saying that debt forgiveness “would be a slap in the face to all those who struggled to pay off their loans,” he wrote that the plan “would be tremendously unfair to those who have been struggling for years to pay off their student loans.”

With two undergraduate degrees and the debt of four master’s degrees between us, my husband and I have been paying nearly $1,000 per month on our student loans for more than a decade. We have about $110,000 left to pay, and, if we’re lucky, we’ll be done in 2033.

But even if we don’t get to benefit from Warren’s proposal, we should help those who can. Why — after my husband and I have gone without so much for so many years — should young people get a pass when they financed school tuition for degrees that don’t guarantee decent jobs?

There are so many reasons.

Well, first there’s the fact that college used to be relatively affordable to someone willing to work throughout. In 1973, one year’s tuition at an in-state public school was $2,175 — not nothing, for sure. In fact, if you run this number through an inflation calculator, you’re looking at about $12,450 in 2019 dollars. But the actual average cost for the same schooling today is $33,300.

Then there’s the reality that it isn’t just spoiled rich kids who would likely be getting a bailout. Most students who take on the responsibility of student loans to pay for college are of modest means or truly have nothing to put toward their post-secondary education.

And know that they almost surely all got “student-loan counseling” — I recall mine being a seven-minute video at the financial aid office — and were asked to sign a complex contract that attested to their understanding that they needed to pay back all the money with interest. But when you are raised with the understanding that college is the be-all and end-all to life and you will die destitute without it, you sign and hope for the best.

How about the numerous predatory “higher-education institutions” who hard-sold people — usually those who would be the first in their families to attend college — on overpriced degrees with little use in the competitive job market?

From Trump University to an alarming number of culinary institutes and beauty schools, millions of people have been baited with the promise of high-paying jobs in return for exorbitant tuition and fees that, like any other student loans, could not be discharged in bankruptcy. And not only young people just starting out were drawn in to taking on college debt; many older people who attempted to get extra training after a job loss were also caught up in taking on hefty loans.

A lot of people like me who have the privilege of being able to afford a home, safe transportation and many of life’s comforts are wrong in believing that the beneficiaries of loan forgiveness are spoiled millennials who’ve always been given the world on a platter and will become monsters if they get away with not paying for school.

In truth, the constant chorus preaching that college is the only worthwhile path to a stable future convinced everyone so thoroughly that millions of moms, dads, aunts, uncles and grandparents find themselves in debt they took on to ensure their own employability or that of their young loved ones.

The Federal Reserve reported that Americans over 50 owed more than $260 billion in student debt in 2018, up from $36 billion in 2004. The Consumer Financial Protection Bureau says that nearly 40 percent of borrowers 65 and older are in default.

Almost no degree guarantees a decent job these days. Yet society still pushes that lie. As a result, our economy will never thrive with so many people under the boot of predatory education lending and collection.

These kids and seniors need a bailout, and if that means an “unfair” figurative slap in the face to those of us who aren’t in default, we’re at least in the best financial position to take one for the team.

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